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National, Spirit Denied Atsb Loan

Thu Aug 15, 2002 12:59 pm

http://biz.yahoo.com/rc/020814/airlines_spiritairlines_1.html

It looks like N7 may be switching to a Ch. 7 soon. I hope the people who purchased the 9/11 fares didn't need to make those flights, or were fairly hard pressed for cash.

Spirit will still stay alive. They are doing fairly well from what I hear, although I can't find out a lot as they are a privately held company.
 
Guest

RE: National, Spirit Denied Atsb Loan

Thu Aug 15, 2002 1:20 pm

Ok, it's not over yet. Some folks over at http://www.nationalairlinespilots.com seem to think so though. One of National's employees wrote on a different message board

It is unfortunate the ATSB has declined our application. We were so close to turning this operation around. Timing is everything. Airlines are parking airplanes, leasing companies are willing to negotiate, fuel prices are reasonable, the majors are retrenching their route structures, leisure paxs are flying, etc.... National could have been in a positon to seize upon these opportunites and grow this airline into a profitable company. Unfortunately, we were competing against an airline which received a government handout and we ran out of time and money. What can we do now? On August 19 there is a meeting in bankruptcy court.

I hope National can get back on it's feet. I highly doubt it now. I'm sure there is a "back up" plan in place but it's too little too late. National won't go out suddenly like Vanguard did, but all I can say is that it's pretty much over  Crying


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clickhappy
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RE: National, Spirit Denied Atsb Loan

Thu Aug 15, 2002 11:34 pm

I just want to let everyone know that I flew National to Vegas, first class both ways, and it was a GREAT flight. Nice service and clean planes, we were also early. I would be very sad to see National go.
 
AirT85
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RE: National, Spirit Denied Atsb Loan

Thu Aug 15, 2002 11:51 pm

Even if National went bust tomorrow it wouldnt be suddenly like Vanguard. Vanguard shut down the day they filed chapter 11, National has been in chapter 11 for quite some time now. I wish them all the best. Philadelphia love's National. I know several people who have flown them to the west coast.
tony
Why would God make us all so different, if He wanted us to be the same?
 
travatl
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 2:26 am

National is PISSED about this decision. Actually, this article makes some good points to ponder.....especially the reference to the government's possibility of being a 1/3 owner in America West, National's primary rival.

http://biz.yahoo.com/bw/020815/140528_1.html

Very best of luck to them.

Travis
 
planeguy
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 2:44 am

OK, so what about Spirit? What kind of shape have they been in lately? Are they going to be the next carrier to go down the bankruptcy trail or do they have the staying power to still be around?
 
AirT85
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 2:47 am

Spirit has consistently enjoyed high load factors (i think somewhere around 92% they said last time i read on their website) but the high load factors don't mean a thing if the fares are dirt cheap. Because they are a privately-held company, we may not know until they do file chapter 11 if their finances are in bad shape.
Why would God make us all so different, if He wanted us to be the same?
 
airlinelover
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 3:24 am

Although I have never flown on National, I would've loved the chance to do so.. I hope I still GET that chance.. The first time I saw that C/S on their jets, I loved it.. simple, yet effective... Anyway, I really hope that this is not the end of National..

Chris
Lets do some sexy math. We add you, subtract your clothes, divide your legs and multiply
 
Guest

RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 4:15 am

AirT85: Actually, what would happen most likely is that there is supposed to be a bankruptcy hearing on 8/19, IIRC. If Conway and co. can't come up with a miracle, they will most likely get shut down that day, with the last flights being ones coming into Vegas.

Travis: I don't think that the HP factor was big at all. National's margin has been about -15 to -20% with 75-80% loads, which is horrendous. The other two largest carriers at LAS are low-fare carriers(LUV, AWA) made a big contribution, along with the fact that they(National) have spent more time flying in bankruptcy than out of it.
 
UAL-Fan
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 4:25 am

Ok,

I know that going bankrupt seems to be the solution to everyones problems these days.....however, isn't National already Bankrupt. Didn't that already happen......can you go Bankrupt x 2? How many times can you go bankrupt? Is there a limit to the amount of time between each trip to Bankrupt court? Can I go bankrupt too? I hate paying bills. Can I get money from the govt. so I maybe won't go Bankrupt, but probably will go Bankrupt?
 
Guest

RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 4:33 am

UAL-Fan,
There are differently levels of bankruptcy.
In short:
-Chapter 7 is liquidation. Assets are liquidated and paid out to creditors who usually only get a small fraction of what they are owed.
-Chapter 11 is reorganization of debt into manageable payments. Basically, the courts decide what the airline can afford and what percentage of their money creditors will receive.

Chapter 13 is the individual's equivalent of Chapter 11. You can declare bankruptcy if your liabilities/debt is larger than your assets/worth. However, if you survive and emerge from bankruptcy, your credit is shot, you will have problems getting good loan or financing terms, etc. Look at TWA.... they got really bad lease deals due to their poor credit after a few trips to bankruptcy court.

If National goes further into bankruptcy, it'll be Chapter 7... close up shop and the creditors grab whatever assets they can claim to make up for the millions of dollars they will be out.
 
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EA CO AS
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 4:46 am

While the writing appears to be on the wall for N7, rumor has it that Alaska Airlines is quite eager to pick up their B-757 leases and some flight crews to man 'em.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
AirT85
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 4:59 am

thanx lowfareair i was not aware of that meeting. i just meant tho, national's been in chapter 11 for quite sometime, whereas vanguard filed and went out almost immediately.
tony
Why would God make us all so different, if He wanted us to be the same?
 
gr8slvrflt
Posts: 1452
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 5:05 am

The old rumors of AirTran taking over National are making the rounds again. This time around word is that Boeing will help with the financing. We'll see.
I work for Southwest, but the views expressed are my own and do not necessarily represent those of Southwest.
 
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EA CO AS
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 5:36 am

AirTran would be a great candidate, too. Personally, I think they'd benefit from acquiring some smaller equipment first, like B-737-800s instead. No one ever went bankrupt from flying planes that were too SMALL, right?  Smile

I'd love to see Alaska and National make something happen, though. The thought of seeing that Eskimo on the tail of a mighty B-757 sends a big dopey grin across my face.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
Matt D
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 5:38 am

No one ever went bankrupt from flying planes that were too SMALL, right?

**COUGH COUGH** Midway**COUGH COUGH** CRJ**COUGH COUGH**F-100**COUGH COUGH**  Wink/being sarcastic

 
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EA CO AS
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 7:32 am

Crikey, Matt's got it! Midway's only problem was that they weren't operating B-747s! If only they'd had them, by God, they would still be around!  Big grin
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
SegmentKing
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RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 12:01 pm

you can fly National for $1 on Sept 11...

-nate
~ ~ ~ ~ pRoFeSsIoNaL hUrRiCaNe DoDgEr ~ ~ ~ ~
 
Guest

RE: National, Spirit Denied Atsb Loan

Fri Aug 16, 2002 12:03 pm

you can fly National for $1 on Sept 11...

It'd be quite the event if National went Chapter 7 on that day too... stranding thousands all over the place with tickets that were near worthless even with valid.
 
srbmod
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Joined: Tue Mar 20, 2001 1:32 pm

RE: National, Spirit Denied Atsb Loan

Sat Aug 17, 2002 1:13 am

If the rumor about AirTran and National is true (more than likely it's just like any other rumor), that would give AirTran a suitable base in which to launch western service. Use the 757s for flights between the hubs (honestly, I'd ditch LAS as a hub, and move it to COS) and to cities like MCO and LGA. I once heard that Valujet had intentions to change their name to National once they got to a certain size (100+ a/c), so AirTran would probably use the National name (better name anyway) if they were to buy them out. Spirit is a carrier that in terms of finances, not too many know about. Since Spirit is privately held, they don't have to release any financial info to the public; but if they are in financial straits (they have to be if they applied for ATSB loans), the public won't know how bad until the company files for CH. 11 or 7.
 
LoneStarMike
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Joined: Sat Jul 01, 2000 1:02 pm

RE: National, Spirit Denied Atsb Loan

Sat Aug 17, 2002 5:58 am

Here's two tidbits regarding this topic.

Over at Aero-news, there was an article about National and Spirit being denied the loan guarantees. The article mentioned:

The consulting firm being utilized by the ATSB in the review of the revenue forecasting techniques of applicants is GRA, which is partially owned by General Electric. General Electric, through their aircraft leasing division GECAS, is one of the largest creditors of America West and US Airways, the only successful applicant and conditionally-approved applicant, respectively. Surely, with the number of reputable financial consulting firms specializing in these matters, the ATSB could have and should have selected a firm with more independent credentials.

The other little tidbit was a post made over at USAviation.com. The poster indicated that it appeared that the votes were rather close to disapprove both airlines applications, but the thing that swayed them to vote against Spirit's and National's application was the September 11th marketing stunts. Spirit is flying folks free across the system and National will fly you to LAS for $1.00. The reasoning seemed to be, "Well, Spirit and National obviously can't fill up their seats, so they're giving everything away on the 11th. If they can't fill up their seats, they must not have a good recovery plan in place, so why should we guarantee their loans?"

Now I don't know if either of these tidbits are true or not, I'm just passing on things I've read to add to the discussion.

LoneStarMike

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